This project will identify the determinants of and calculate cost- effectiveness ratios for 3 alternative treatments for local breast cancer in the elderly: modified radical mastectomy (MRM), breast conserving surgery (BCS) with radiotherapy (RT), and BCS without RT. Treatment choice and short- and intermediate-term outcomes will be analyzed using data from a prospective convenience cohort of approximately 800 newly-diagnosed elderly (65+) breast cancer patients who will be interviewed post- treatment and followed for up to 2 years. Their surgeons will be surveyed by mail with telephone follow-up. We will also conduct surveys of nationally representative, retrospective, random samples of breast cancer surgeons (n = 1,000) and their Medicare patients (1,575 decedents and 3,000 survivors) who were treated in 1992 in order to (a) validate and extend the treatment choice model to a national sample and (b) measure 5- year outcomes. Cost-effectiveness ratios for each treatment will be calculated for all older women and for substrata defined by age, race, geography, and initial health status, based on 5-year outcomes and short- and intermediate-term outcomes imputed from the convenience sample. Medical care costs will be measured using Medicare claims data. The proposed analyses are multidisciplinary, drawing on theoretical models and prior research in economics, behavioral science, and cost- effectiveness analysis, as well as the relevant clinical literature. Recognizing the observational nature of the data, estimation of the treatment choice and treatment-outcome models uses the instrumental variable approach, a common econometric method, to adjust for the joint selection of providers and treatment choices by patients and for the effects of unobservable differences in patients' initial health and preferences. The project will develop clear recommendations regarding the appropriateness of observed patterns of treating local breast cancer in the elderly, taking account of circumstances that may differ with age, initial health, and access to different types of providers.